AZ State Consignment Laws & Copyright

You will find 3 artist resources below:

1. Consignments of Works of Fine Art
2. Fraudulent Practices in the Sale of Indian Arts and Crafts
3. Fundamental Copyright Principles for Artists

Arizona Revised Statutes
Title 44 - Trade and Commerce

Article 12 Consignments of Works of Fine Art

44-1771. Definitions
In this article, unless the context otherwise requires:

1. "Art dealer" means a person engaged in the business of selling works of fine art, other than a person exclusively engaged in the business of selling goods at public auction.
2. "Artist" means the creator of a work of fine art.
3. "On consignment" means delivered to an art dealer for the purpose of sale or exhibition, or both, to the public by the art dealer other than at a public auction.
4. "Work of fine art" means an original or multiple original art work which is:
   1. A visual rendition, including a painting, drawing, sculpture, mosaic or photograph.
   2. A work of calligraphy.
   3. A work of graphic art, including an etching, lithograph, offset print or silk screen.
   4. A craft work in materials, including clay, textile, fiber, wood, metal, plastic or glass.
   5. A work in mixed media, including a collage or a work consisting of any combination of subdivisions (a) through (d).

44-1772. Art dealer and artist; relationship

If an art dealer accepts a work of fine art, on a fee, commission or other compensation basis, on consignment from the artist who created the work of fine art:

1. The art dealer is, with respect to that work of fine art, the agent of the artist.
2. The work of fine art is trust property and the art dealer is trustee for the benefit of the artist until the work of fine art is sold to a bona fide third party or returned to the artist.
3. The proceeds of the sale of the work of fine art are trust property and the art dealer is trustee for the benefit of the artist until the amount due the artist from the sale is paid.
4. The art dealer is strictly liable for the loss of or damage to the work of fine art while it is in the art dealer's possession. The value of the work of fine art is, for the purpose of this section, the value established in a written agreement between the artist and art dealer prior to the loss or damage or, if no written agreement regarding the value of the work of fine art exists, the fair market value of the work of fine art.

44-1773. Purchase or resale of consigned fine art by fine art dealer

1. If a work of fine art is trust property under section 44-1772 when initially received by the art dealer it remains trust property notwithstanding the subsequent purchase of the work of fine art by the art dealer directly or indirectly for the art dealer's own account until the purchase price is paid in full to the artist.
2. If the art dealer resells a work of fine art to which subsection A of this section applies to a bona fide third party before the artist has been paid in full, the work of fine art ceases to be trust property and the proceeds of the resale are trust funds in the hands of the art dealer for the benefit of the artist to the extent necessary to pay any balance still due to the artist. The trusteeship of the proceeds continues until the fiduciary obligation of the art dealer with respect to the transaction is discharged in full.
   

44-1774. Trust property exempt from claims of art dealer's creditors

Notwithstanding title 47, no property which is trust property under section 44-1772 or 44-1773 is subject to the claims, liens or security interests of the creditors of the art dealer.

44-1775. Art dealer required to obtain written contract

1. An art dealer may accept a work of fine art, on a fee, commission or other compensation basis, on consignment from the artist who created the work of fine art only if prior to or at the time of acceptance the art dealer enters into a written contract with the artist establishing:
   1. The value of the work of fine art.
   2. The time within which the proceeds of the sale are to be paid to the artist, if the work of fine art is sold.
   3. The minimum price for the sale of the work of fine art.
2. If an art dealer violates this section a court may, at the request of the artist, void the obligation of the artist to that art dealer or to a person to whom the obligation is transferred, other than a holder in due course.

44-1776. Art dealer; duties

1. An art dealer who accepts a work of fine art, on a fee, commission or other compensation basis, on consignment from the artist who created the work of fine art may use or display the work of fine art or a photograph of the work of fine art or permit the use or display of the work of fine art or a photograph of the work of fine art only if:
   1. Notice is given to users or viewers that the work of fine art is the work of the artist.
   2. The artist gives prior written consent to the particular use or display.
2. An art dealer who sells a work of fine art which is on consignment for the purpose of sale shall transmit all monies due the artist on a monthly basis.

44-1777. Waiver voided

Any portion of an agreement which waives any provision of this article is void.

44-1778. Civil penalty

1. Any art dealer who violates section 44-1775 or section 44-1776, subsection A is liable to the artist in an amount equal to:
   1. Five hundred dollars.
   2. The actual damages, if any, including the incidental and consequential damages, sustained by the artist by reason of the violation and reasonable attorney fees.
2. An art dealer who violates section 44-1776, subsection B is liable to the artist in an amount equal to three times the amount due the artist.

INDIAN ARTS AND CRAFTS

Arizona Revised Statutes
Article 2.1 Fraudulent Practices in the Sale of Indian Arts and Crafts

44-1231. Definitions
In this article, unless the context otherwise requires:

1. "Authentic Indian arts and crafts" means any product which is Indian handcrafted and is not made by machine or from unnatural materials, except stabilized or treated turquoise.
2. "Findings" means an ingredient part of the product which adapts the product for wearing or display, including silver beads, leather backing, binding material, bolo tie clips, tie bar clips, tie tack pins, earring pins, earring clips, earring screw backs, cuff link toggles, money clips, pin stems, combs or chains.
3. "Indian" means a person who is enrolled or who is a lineal descendant of one enrolled upon an enrollment listing of the bureau of Indian affairs, or upon the enrollment listing of a recognized Indian tribe domiciled within the United States border.
4. "Indian handcrafted" means the skillful and expert use of the hands in making products solely by Indians within the United States, including the use of findings, hand tools and equipment for buffing, polishing, grinding, drilling or sewing.
5. "Made by machine" means the producing or reproducing of a product in mass production by mechanically stamping, casting, blanking or weaving.
6. "Natural turquoise" means turquoise, exclusive of any backing material, whose composition has not been chemically or otherwise altered.
7. "Nonauthentic Indian arts and crafts" means any product which is made to imitate or resemble authentic Indian arts and crafts and which is either:
   1. Not Indian handcrafted.
   2. Made by machine or from unnatural materials, except stabilized or treated turquoise.
8. "Reconstituted turquoise" means dust and turquoise particles which are mixed with plastic resins and are compressed into a solid form so as to resemble natural turquoise.
9. "Stabilized turquoise" means turquoise which has been chemically hardened, but not adulterated so as to change the color of the natural mineral.
10. "Synthetic turquoise" means any compound or mineral which is manufactured or treated so as to closely approximate turquoise in appearance.
11. "Treated turquoise" means turquoise which has been altered to produce a change in the coloration of the natural mineral.
12. "Turquoise" means a hydrous copper sulphate, containing aluminum salts, plus iron.
13. "Unnatural turquoise" means any substance which is not natural turquoise, including stabilized turquoise, treated turquoise, reconstituted turquoise or synthetic turquoise.

44-1231.01. Unlawful acts

It is unlawful for any person to knowingly do any of the following:

1. Sell or offer for sale any products represented to be authentic Indian arts and crafts unless the products are in fact authentic Indian arts and crafts.
2. Sell or offer for sale any authentic Indian arts and crafts represented to be of silver or nonauthentic Indian arts and crafts represented to be of silver unless the products are made of coin silver or sterling silver.
3. Sell or offer for sale nonauthentic Indian arts and crafts unless the nonauthentic Indian arts and crafts are clearly labeled as to any characteristics which make them nonauthentic.
4. Sell or offer for sale any unnatural turquoise, mounted or unmounted, without a written disclosure of whether the turquoise is stabilized, treated, reconstituted or synthetic.
5. Sell or offer to sell reconstituted turquoise or synthetic turquoise unless the turquoise is clearly labeled as synthetic turquoise.
6. Engage in any false, misleading or deceptive advertising or any unconscionable trade practice regarding Indian arts or crafts. In this paragraph "unconscionable trade practice" means any act or practice in connection with the sale or offering for sale of Indian arts or crafts to a person which to the person's detriment takes advantage of the person's lack of knowledge, ability, experience or capacity to a grossly unfair degree or results in a gross disparity between the value received by the person and the price paid.

44-1231.02. Sale of Indian arts and crafts; inquiry; labels

1. A person who sells or offers to sell nonauthentic Indian arts and crafts shall post a sign bearing the words, in letters not less than three inches in height, "nonauthentic Indian arts and crafts" above or adjacent to the articles being sold.
2. A person who sells or offers to sell a product that is represented to be authentic Indian arts or crafts shall make due inquiry of his suppliers concerning the true nature of the materials, product design and process of manufacture to determine whether the product may be lawfully represented as authentic Indian arts or crafts.
3. A person who sells or offers to sell Indian arts and crafts may elect to label or otherwise clearly and conspicuously disclose as authentic Indian arts and crafts all articles that are authentic Indian arts and crafts in accordance with this article and rules adopted pursuant to this article.

44-1231.03. Enforcement; civil action and penalty; injunctive relief; restitution; private right of action; damages

1. The attorney general or the county attorney shall enforce the provisions of this article. An authorized tribal prosecutor may assist the attorney general or the county attorney in determining whether the provisions of this article are violated.
2. In addition to the criminal penalties provided in this article, the attorney general or the county attorney may bring a civil action for a violation of this article, and the court may order temporary or permanent injunctive relief. In such an action the court may order restitution to the injured party and such other relief the court determines is appropriate.
3. In an action brought under this section, if the court finds that a person is wilfully using or has wilfully used a method, act or practice that is unlawful under this article, the attorney general or county attorney may recover a civil penalty of not more than five thousand dollars for each violation.
4. Civil penalties collected pursuant to this section shall be deposited in the state general fund if the action is brought by the attorney general and in the county general fund where the action is prosecuted if the action is brought by the county attorney.
5. Unless restitution is ordered in an action brought under subsection B, a person who suffers financial injury or damages by reason of any conduct which is in violation of this article may sue in the superior court and recover actual damages sustained and the cost of the suit, including reasonable attorney fees.

44-1231.04. Rules

The attorney general shall adopt necessary rules to implement and enforce the provisions of this article. Rules adopted under this article may specify designations other than "authentic Indian arts and crafts", including a designation such as "Indian crafted", for authorized labeling as Indian arts and crafts.

44-1231.05. Violation; classification

Unless the conduct is prohibited by section 13-1802 or section 13-2310 in which case those sections shall apply, a person who knowingly violates the provisions of this article is guilty of the following:

1. A class 3 misdemeanor if the violation involves property offered for sale at less than two thousand five hundred dollars.
2. A class 2 misdemeanor if the violation involves property offered for sale at two thousand five hundred dollars or more but less than twenty thousand dollars.
3. A class 1 misdemeanor if the violation involves property offered for sale at twenty thousand dollars or more.

FUNDAMENTAL COPYRIGHT PRINCIPLES FOR ARTISTS

Copyright is the group of legal rights automatically given to the author of an original work of art, pictorial, graphic and sculptural for a limited period of time. These rights are INDEPENDENT from ownership of the art work and are no longer dependent upon publication or registration of the work.

1. SIMPLIFIED COPYRIGHT DEFINITIONS FOR ARTISTS
   1. A work is "Created" when it is fixed for the first time in a copy.
   2. A work is "fixed" when it is tangibly embodied with the artists' permission in a form, which permits its perception or reproduction.
   3. A work is "published" when copies are distributed to the public.
   4. A work is "performed" when it is recited either directly or mechanically.
   5. A work is "displayed" when it is shown either directly or mechanically.
   6. A work is "publicly" performed or displayed at a place where persons outside the normal circle of family acquaintances are gathered.
   7. A "derivative" work is one, which transforms or modifies a prior work.
   8. A "compilation" is a work formed by the collection and assembly of preexisting materials or data.
   9. A "collective" work consists of a number of separate and independent contributions.
   10. A "work for hire" is one made by an employee within the scope of employment or certain defined works made under special commission and designated in writing as made for hire.
2. KEY COPYRIGHT RULES FOR ARTISTS
   1. The basic term of copyright is the artist's life plus 50 years; or 75 years from publication in the case of works, which are made for hire, anonymous or pseudonymous.
   2. Copyrightable works in the literary, performing and visual arts fall in 7 basic categories:
      1. Literary
      2. Musical
      3. Dramatic
      4. Choreographic
      5. pictorial/graphic/sculptural
      6. audiovisual
      7. sound recordings
   3. Copyright encompasses 5 independent exclusive rights:
      1. To reproduce
      2. To distribute **
      3. To prepare derivative works
      4. to publicly perform
      5. to publicly display **
   4. Each of the artist's exclusive rights may be independently transferred or licensed, licensed for limited times, licensed for limited geographical or commercial use.
   5. A person who violates any one of the artist's exclusive rights is liable for infringement and is subject to:
      1. Federal and civil suit
      2. Federal criminal suit, if willful and for profit
      3. Statutory damages between $500 and $1000
      4. Forfeiture of profits and payment of artist's damages
      5. payment of artist's attorney fees
      6. destruction of infringing copies
      7. injunction against further infringement
   6. An artist's exclusive rights are subject to certain limitations including:
      1. Fair use for purposes of criticism, comment, news reporting, and scholarship or research.
      2. Library reproduction for individual research purposes
      3. Educational and non-profit performances and displays
   7. Works prepared by the U.S. Government are not subject to copyright otection.
   8. The sale or transfer of a work of art does not include transfer of the artist's copyright.
   9. Except in the case of works made for hire by employees, copyright transfers must involve a written document, signed by the artist.
      Documents transferring any of the artist's' exclusive rights may and should be recorded in the Copyright Office.
   10. Copyright protects the form in which and idea is expressed but not the idea expressed.

Works of art first "published" after March 1, 1989 need not bear a copyright notice ( 1989 Mary M. Artist) but it is highly advisable to include such a notice for importation procedural and remedial reasons.

** This right is lost with the sale of the art piece. Artists who have conveyed their copyrights have an opportunity to recapture those rights 35 years after the grant thus providing remedy for artists who sold their rights at an inappropriate price early in their career.